Private residence relief: final period and lettings relief

Short answer: for disposals on or after 6 April 2020, the last 9 months of ownership of a property that has at some point been the owner’s only or main residence always qualify for private residence relief, whatever the property is used for in that time (TCGA 1992 s223). The period is 36 months where the owner or their spouse or civil partner is disabled or a long-term care-home resident and has no other residence that could qualify (s225E). Lettings relief now applies only where the owner lives in the property while letting part of it, and is capped at £40,000 (s223B).

The final period

A “long-term resident” is someone in a care home who has been there, or is expected to be there, for at least three months.

Lettings relief after April 2020

• Lettings relief is available only where part of the property is the owner’s only or main residence while another part is let out as residential accommodation — shared occupancy.
• No relief is given for any period when the whole property was let.
• HMRC describes the relief as the lowest of: the private residence relief given, £40,000, and the gain arising from the letting.

Watch out for

• The final-period exemption needs the property to have been the owner’s only or main residence at some point. It cannot rescue a property that never was.
• Letting the whole property after moving out no longer brings lettings relief, however long the owner lived there first.

Sources

• TCGA 1992 s223 — amount of relief
• TCGA 1992 s223B — lettings relief
• TCGA 1992 s225E — disabled persons and long-term residents
• HMRC Capital Gains Manual CG64985 — the final period
• HMRC Capital Gains Manual CG64710 — lettings relief

Checked against the sources above on 16 October 2026. General information, not advice on a particular disposal.

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